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2 edition of Impact of taxation on the dividend policy of the firms found in the catalog.

Impact of taxation on the dividend policy of the firms

Meziane Lasfer

Impact of taxation on the dividend policy of the firms

an empirical analysis

by Meziane Lasfer

  • 397 Want to read
  • 31 Currently reading

Published by City University Business School, Centre for Empirical Research in Finance and Accounting in London .
Written in English


Edition Notes

StatementMeziane Lasfer.
SeriesWorking paper series -- 92/4, Working paper series (City University. Centre for Empirical Research in Finance and Accounting) -- 92/4.
ID Numbers
Open LibraryOL21515589M

2. What is the extent of the relationship between dividend payout and firm performance? Literature review Introduction This chapter focuses on previous studies done by various authors in relation to dividend policy and firm performance. The chapter is divided into three sections. The first section gives a definition for dividends and dividend. The objective of the firm is to maximize shareholder value. A central question regarding the firm's dividend policy is therefore whether the dividend policy changes firm value? As the dividend policy is the trade-off between retained earnings and paying out cash, there exist three opposing views on its effect on firm value: 1.

The Clientele Effect and Dividend Theory. Empirical evidence suggests that a firm's dividend policy tends to attract different groups of investors (different clienteles), depending upon how these investors wish to receive their total rate of return on their investment in the company's ically, those investors who want high current investment income and expect to forego anticipated. An Empirical Investigation of the Impact of Dividend Policy on the Performance of Firms in Developing Economies: Evidence from Listed Firms in Nigeria. Benjamin I. Ehikioya. Department of Finance, University of Lagos, Lagos, Nigeria. Abstract. This study investigates the possible impact of dividend policy on the value and performance of.

LITERATURE REVIEW ON DIVIDEND POLICY IN ROMANIA Only a few papers studied the dividend policy in Romania and its implications on firm dynamics. Dragotă et al. () focused on the effect of corporate taxation on dividend policy for the Romanian listed firms over the period Using a File Size: KB. Aivazian, and Booth () find that for both U.S. firms and emerging market firms, profitability affects dividend payments, higher debt ratios correspond to lower dividend payments, and market-to-book ratio has a positive effect on dividend payments, in addition they find little evidence that business risk or size affects dividend payments.


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Impact of taxation on the dividend policy of the firms by Meziane Lasfer Download PDF EPUB FB2

The book includes a brief history of the evolution of dividends, statistics on dividends relative to profits and capital investments, their importance as a component of investor total returns, the relationship of dividends to share price, how management makes dividend decisions, and the impact of different tax regulations on dividend by: If tax on dividends has an impact on the financial policy of the firm, then firms in classical system will lower or avoid dividends as much as they can, while firms in full integration systems will not have to lower their dividends.

The impact of taxation on dividend policy is the point that has much been debated. That is the reason it has received much of academic attention. If taxes do have an impact on dividend policy of a firm, then any change in the taxation structure by the government would bring about change in the dividend policy of the firm (Wu, ).Cited by: 2.

The purpose of this book is to review the theory and empirical evidence regarding the impact of dividend policy on shareholder wealth. It cuts to the quick of such long-standing questions as Why do corporations pay dividends. and Why should investors care. With relevant anecdotes, surveys, examples, and research from the financial press, company documents, and academic literature, the book.

This paper analyses the impact of capital gains taxation (CGT) on dividend policy among firms that are listed at the Karachi Stock Exchange (now, Pakistan Stock Exchange or PSX).

The reason for choosing the Pakistani market is the country’s idiosyncratic taxation system regarding dividend Cited by: 2. Title: IMPACT OF TAXATION ON DIVIDEND POLICY: EVIDENCE FROM PAKISTAN.

Corporate Taxation Policy: If the organization has to pay substantial corporate tax or dividend tax, it would be left with little profit to pay out as dividends. Government Policy: If the government intervenes a particular industry and restricts the issue of shares or debentures, the company’s growth and dividend policy also gets affected.

A B S T R A C T This paper analyses the impact of capital gains taxation (CGT) on dividend policy among firms that are listed at the Karachi Stock Exchange (now, Pakistan Stock Exchange or PSX). The reason for choosing the Pakistani market is the. The paper demonstrated that corporate taxation and board structure have no effect on dividend policy of firms.

The results also imply that performance of companies is an important determinant of. The Impact of Taxation on Dividends: A Cross-Country Analysis.

The purpose of this study was to examine the impact of dividend payout ratio on the value of firm. tax, and market-to-book ratio. data of Non manufacturing Firms listed on the Nigerian. theories suggest that dividend policy has an impact on stock price.

Since both of these theories speaks for dividends potential to impact stock price, it would be interesting to investigate the dependency of stock price on financial performance and if the dependency is similar among firms with different dividend File Size: KB.

Factors Affecting Dividend Policy – Various Factors that have a Bearing on the Dividend Policy Maximisation of owners’ wealth is the objective of the financial manager’s job. Whatever decision he/she makes, whether it is investment decision, financing decision or dividend decision, he/she has to maximise value of the : Rupali C.

The results in Figure 6 show that the effect of the dividend tax cut is strongest in wholly owned firms and then gradually declines in the number of owners—that is, when agency issues and shareholder conflicts are more acute.

For example, in firms with five owners, the tax response of dividend payouts is still significant, but it is about 54% lower than in wholly owned by: Effect of Dividend Policy on the Value of Firms (Emperical Study of Quoted Firms in Nigeria Stock Exchange) Research (PDF Available) January with 3, Reads How we measure 'reads'.

een the determinants of the dividend policy and firm performance. Hypotheses The following are the hypotheses formulated; H 1: There is a significant relationship between firm perfo-rmance and dividend policy.

H 2: There is a significant impact of dividend policy on firm’s performance. nalysis and. File Size: KB. Since the firm's assets, investment opportu- nities, expected future net cash flows and cost of capital are not affected by the choice of dividend policy, its market value is unaffected by any change in the firm's payout pattern.

Thus, dividend policy is irrelevant and firms can choose any payout pattern without affect- ing their by: 6. The aim of the paper is to investigate the impact of dividend policy on firm value. Our sample consists of sixty-three non-financial firms listed on the Bucharest Stock Exchange over the period Employing a fixed effects model, we found that dividend pay-out ratio positively influences firm value after controlling for other firm-specific variables.

dividend payout ratio but mostly dividend policy is due to the size of the firm and its profitability. Keywords: Dividend Policy; Tax Shield; Determinant’s of Dividends.

Introduction. A snowy debate in finance and public economics litera-tures about the role of taxation in corporate dividend policies is there. Taxes and dividend policy. This paper analyzes the impact of capital gains taxation (CGT) on dividend policy among firms that are listed at the Karachi Stock Exchange (now, Pakistan Stock Exchange or PSX).

Dividend policy and its impact on firm value: A Review of Theories and Empirical Evidence.firm value for commercial banks in Kenya.

Dividend Policy The topic of dividends has attracted the attention of many different writers and academicians. Bierman () and Baker, et al. (20 02) defined it as a distribution of firm earnings to stockholders after meeting tax and other payments on borrowed funds.

A study by Olimalade, et.19Determining the impact of taxation on corporate financial decision-making was the core issue of this doctoral project. Focusing on recent and potential corporate tax reforms in the European Union, it aimed at giving some guidelines for financial managers and policy makers with respect to these reforms.